27 April 2010

MLB Draft Value Trade Chart

So, I was watching the NFL draft last Thursday and it got me to thinking about draft pick trade charts. As you probably know, Jimmy Johnson and the Cowboys used this in the late 80s and early 90s in order to make quick deals during the draft, ensuring them equal or greater value. A couple decades later, the system looks a bit simple due to how free agency and rookie slotting made the first round picks less valuable and later second through third round picks much more valuable. Throw in talent variance year by year and the concept still holds strong, but the chart itself is dated.

In baseball, there are no draft pick trades. It does seem though as if this will be included in the next bargaining agreement. I decided during the draft to look whether anyone had done such a thing as to create an actual draft board trade value chart for MLB. Sky Andrecheck almost did it while answering perhaps more interesting questions here. He mentions how the first few picks are much more valuable than the later ones, but does not put an actual value on them. That is probably the most prudent thing to do, but here . . . we are going to be a little irresponsible.

First things first: recreate the value chart by painstakingly redoing Andrecheck's work. What this graph illustrates is the power best fit line of players selected in the 1990-1999 draft and associated with their WAR during their first six years of MLB service.

As you can see from this chart and when you compare it to his previous one, these are somewhat comparable. There are not identical, but they are close enough. We may have some disagreement on what counted as the first six years of MLB tenure. I don't think the differences are all that significant.

Another thing to notice is just how exceptional the bust rate is with these picks. The formula on the chart shows the top pick in the draft being worth about 12.4 WAR over his first six years in the Majors. That is an average player. The fifteenth player selected has a WAR total of 2.4, which would be slightly above average if all of that was accomplished over a single season as opposed to six. Value drops quickly in the draft and risk becomes more and more apparent. For a savvy team, it may not be incredibly worthwhile to deal for anything outside of the first few selections. That is, unless you think your scouting department is better than everyone else's department.

After the jump, the quick and easy trade chart.Round 1 Chart

Picks 31-300 Chart

So what could the Orioles get for their third overall pick?In this scenario, we have the Orioles first round pick as being worth 510 points. They could match up with the Los Angeles Angels of Anaheim. This deal would be equal, based on the chart:

What this goes to show is just how valuable those first few picks in the draft actually are. They are so much more valuable that a straight up trade for specific draft picks probably would not be very common at the top of the draft, but certainly would be later on. If trades at the top of the draft would occur, then it would probably include established prospects in the minor leagues.

Next time, converting this all over to money so we can include prospects in the deals.

2 comments:

You are the first person I have read who looked at the draft results and realized that what is more important is the bust rate of even the top picks.

I studied this long ago - http://sfgiants.scout.com/2/343576.html - and came to the conclusion that the only way to rebuild is to go through a period of losing in order to get draft picks that greatly increases your odds of finding a good player.

Look at the Atlanta Braves when Bobby Cox was the GM: lose horribly, building up the farm system, then hit the track running. The Rays have built up over their franchise life, and should be reaping the rewards for many years now. I shudder to think how good they could have been had they drafted Posey instead.

Dombrowski of the Tigers did that with the Expos, then Marlins, and now Detroit, lose badly, pick up good picks, then drive for the title.

Of course, it is not as simple as that. You need real talent for player evaluation, even for the first picks overall, or you could end up with Matt Bush and other top pick failures. See the Royals and Pirates for long term examples of that.

When the bust rate is so high, that requires winning teams to plumb other sources, which the Yankees have been doing for many years now.

Draft players who fell due to money reasons and not for talent or potential (Other examples: Tigers smartly did that with Porcello; D-backs with Drew).

Go all in on international free agents, particularly both Latin America and Japan. Create an academy in hot spots.

I would go further. Put more money into the minors. Equipment to help them keep in shape. Instructors to help them learn. Food, at least lunch and dinner on game days, so that they don't have to go hungry or, worse, go on a low-cost fast food diet. Enable your players to develop by giving them the tools to succeed.

One thing that I wish I had more access to would be hard data on signing bonuses for international signings. It would be nice to see how efficient that market is. In the 1990s it was incredibly inefficient. Teams might assess things better nowadays.

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